In 2017, President Donald Trump announced plans to privatize the U.S. air traffic control system, claiming it was outdated and ineffective. However, those plans never materialized.
Currently, the Trump administration is shifting its approach and prioritizing a significant investment in the Federal Aviation Administration (FAA) to modernize the air traffic control system, especially following recent technical failures and staffing issues. This change of focus comes after a tragic midair collision that resulted in the loss of 67 lives earlier this year.
Transportation Secretary Sean Duffy emphasized that engaging in a debate about privatization would only lead to division. He stated at a recent press conference, “To have a fight about privatization is just going to divide people,” suggesting that such disagreements could hinder progress toward establishing a new and improved air traffic control system.
Industry groups that once championed privatization are now uniting behind Duffy’s modernization plan. This initiative is aimed at upgrading outdated equipment and accelerating the hiring of new air traffic controllers. It has garnered support from the Modern Skies Coalition, which includes various groups such as the major airlines’ trade association and the National Air Traffic Controllers Association.
However, amid recent travel disruptions, critics of the FAA have reignited calls for privatization, arguing that removing air traffic control from government oversight could be the solution.
Looking at Canada and Global Models
Proponents of air traffic control privatization often cite Canada as a successful example. In 1996, Canada privatized its air traffic control system, transferring it to the non-profit organization NAV CANADA for $1.5 billion. This move was initiated to address significant delays and inefficiencies within the air travel system.
McGill University’s aviation law professor Vincent Correia noted that privatization facilitated the acquisition of new technologies and improved air traffic management without the bureaucratic delays typical of public procurement processes.
Funding mechanisms also underwent a significant change in Canada. The country transitioned from funding air traffic control primarily through tax revenue to implementing user fees based on the weight and distance of flights.
Correia explained that the privatization was a logical progression for Canada’s aviation sector, which already featured privately-owned aircraft manufacturers and commercial airlines.
Other countries have also adopted various air traffic control models outside direct government control, including NATS in the United Kingdom, Airservices Australia, Airways New Zealand, DFS in Germany, and Skyguide in Switzerland.
In a 2017 report, the Congressional Research Service noted no clear superiority among these international models compared to existing government-run systems, like that of the FAA, in terms of productivity, cost-effectiveness, service quality, or safety.
Current Status of Air Traffic Control in the U.S.
Notably, private air traffic controllers are already part of the U.S. system. The FAA’s Contract Tower Program enables certain airports with lower traffic volumes to employ controllers from private firms. Over half of federal air traffic control towers fall into this category, primarily serving smaller general aviation airports.
The privatization debate in the U.S. has met challenges, particularly when citing the experiences of other countries. Critics point to various issues faced by countries that have adopted privatized systems, such as a 2023 report from the International Civil Aviation Organization that marked a decrease in Canada’s flight safety grade along with current controller shortages.
Ed Bolen, CEO of the National Business Aviation Association, warned that operating a private system in the U.S. would be particularly complex, given the dense and complicated nature of its airspace. He stated, “When we look around at the performance in Australia, in New Zealand, in Europe, in the United Kingdom and in Canada, we see very small, not particularly complex operations compared to the U.S. and we see chronic delays.”
Another concern regarding privatization is the potential marginalization of smaller airports and pilots who do not generate the same level of economic activity as larger airlines. Jim Coon, from the Aircraft Owners and Pilots Association, noted that small airports are crucial for numerous community services, such as medical transport and disaster relief, and they could suffer under a privatized model that prioritizes profitability.
NAV CANADA’s governance ensures that its board includes representatives from various stakeholders, including airlines, general aviation, government, and labor unions.
The COVID-19 pandemic has also revealed vulnerabilities in privatized systems, as those reliant on user fees faced significant operational issues when air travel plummeted.
Alternatives to Privatization: The Public Utility Model
Robert Poole, director of transportation policy at the Reason Foundation, argues for a public utility model for the U.S. air traffic control system. This concept has historical precedence, as the Clinton administration proposed converting the FAA into a quasi-governmental corporation in 1994.
Under the current system, funds collected from travelers and airlines are channeled into the U.S. Treasury, requiring congressional appropriation before being allocated to the FAA. Poole suggests that a public utility model would allow revenues to flow directly to the air traffic organization, whether a non-profit entity or a government corporation.
This setup could enable the public utility to issue bonds for large projects—something the FAA cannot do currently—while also streamlining procurement processes. Additionally, Poole believes this model would enhance safety oversight by allowing the FAA greater autonomy in enforcing regulations, as air traffic controllers would not be direct employees of the FAA.
Prospects for U.S. Air Traffic Control Privatization
Former Republican Rep. Bill Shuster, who supported air traffic control privatization legislation in 2017, has continued to advocate for this approach into late 2023. However, calls for privatization within the aviation industry have dwindled, and even major airlines that previously supported the idea are now opposing it.
In February, the trade group Airlines for America, which had previously endorsed Trump’s 2017 privatization effort, joined other aviation organizations in voicing concerns that privatization discussions could divert attention from planned upgrades to the air traffic control system.
Coon highlighted a growing consensus within the aviation community for modernizing the current air traffic control system rather than pursuing privatization. He remarked, “It’s been discussed for decades. There’s not consensus there. But there is consensus now to modernize our system, and that’s what we want to do.”
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